Company: Enron Participants Only Blacked Out for 10
Days

December 14, 2001 (PLANSPONSOR.com) - Except for 10
days when it was switching 401(k) recordkeepers, retirement
plan participants could transfer their contributions from
Enron's company stock into 19 other investment options,
officials said Friday.

During the blackout from October 29 to November 13 –
which Enron officials claimed they repeatedly announced in
a mailing to employee homes and through their internal
e-mail system – Enron shares fell from $13.81 to $9.98.
Earlier reports said the blackout lasted for three
weeks.

“Outside of the brief transition period, Enron employees
have always been able to transfer their own contributions
in the 401(k) at any time,” the Houston-based energy trader
said in a statement. “They have 20 investment options to
choose from, Enron stock being one of them.”

However, the company admitted in the statement that an
employee couldn’t move Enron’s matching contribution of 50%
up to 6% of pay, made in company stock, until he was at
least 50 years old.

A Seattle lawyer representing Enron employees called
Friday’s statement “a bunch of baloney” in an interview
with the Associated Press.

Attorney Steve Berman said 401(k) accounts were frozen
October 17, the day after Enron’s release of a $618 million
third-quarter loss unleashed an unprecedented descent that
prompted the company to file for federal bankuptcy
protection December 2.

Enron’s bankruptcy application, listing $49.8 billion in
assets, was the largest in US history.

“None of my clients have ever mentioned, nor have I seen
any of these reminders that Enron supposedly sent out,”
Berman told the AP. He also criticized Enron for the
freeze, regardless of whether it was planned or not.

Friday’s statement was the first official comment on
allegations made in a flurry of lawsuits that Enron
employees were losing large sums of money on their company
stock investments during the blackout – estimated in one
suit at $850 million.

Enron shares have fallen from a high of $90 in August
2000 to 63 cents Friday, the decline accelerating since
October 16 amid a series of disclosures about its
deteriorating money picture.